Ageing is not all bad news, as baby-boomers entering retirement hold promise
for some business sectors.

Last year, there were around 500m people in the world aged over 65, about 8pc of the global population. That was roughly four times the 130m people over the retirement age in 1950, which represented 5pc of all people at the time. But if the United Nations' population projections are right, the world's steady ageing process has a long way still to go. By 2050, the UN predicts, there will be 1.5bn people over 65, one in six of everyone on earth.

As the chart shows, the ageing process is not even. In Europe, the crossover point at which the number of retirees exceeds the number of children has already happened. In 2005, there were 116m people over 65 and the same number under 15. Over the next 40 years, the number of children in Europe will flatten out at about 100m but the number of older people will rise steadily to nearly 200m.

In Asia, exactly the same process is taking place but the crossover will not happen for another 40 years or so, despite the rapid ageing of the Chinese population as a result of that country's one-child policy and that of Japan – where within five years there will be twice as many retired people as children and by 2050 four times as many. Asia will continue to have a demographic advantage over the West for many years to come but the end point will be the same.

The issue of ageing is usually framed as a contrast between the good news that many of us will live longer lives than our parents and grandparents and the bad news that we are on average ill-prepared financially for that longer life. When Steve Webb, the Pensions Minister, announced recently that nearly a fifth of Britons alive today would reach the age of 100, his sub-text was clear – our pension reforms are essential and all of you need to take more personal responsibility for your retirement planning.

Ageing certainly brings with it a whole host of economic challenges. A reduced labour supply is a negative for long-term economic growth but the more immediate impact is on government finances in terms of higher pension and health-care costs. Japan already diverts around a fifth of GDP to age-related expenditure and this will rise to more than a quarter by 2050.

In Europe, the problem is, if anything, even more acute, with the ratio of age-related spending in Italy, Germany and France expected to rise to 30pc. It is no wonder that governments the world over are pushing to raise retirement ages and to switch responsibility for pension provision from the state to the individual.

But ageing is not all bad news. The advertising industry has been slow to understand the increasing consumption potential of the baby-boom generation entering retirement today, but the cohort of people born between 1946 and 1964 has amassed significantly more wealth during its working life than previous generations and, perhaps as important, they have grown up in a consumerist age, they are better educated and more physically active.

One obvious beneficiary of an ageing population is the health-care sector, which finds itself in a virtuous circle. As baby boomers live longer they spend more on health care; as they spend more on health care they live longer. And it is not just drugs for age-related illnesses. Lenses that help us read when our arms won't stretch any further are just one long-term growth market as a consequence of ageing.

Other sectors likely to be of interest to investors looking to capitalise on the ageing theme include financial services, parts of which stand to benefit from a rapid rise in retirement assets under management (up by 40pc in the US over the next four years, according to Goldman Sachs). Care services and assisted-living homes are certain to see continuing growth while various leisure and travel firms, cruises for example, are poised for a growth period. Home and personal security technology could do well.

Ageing is a two-edged sword for us all. For governments and individuals, it is a financial challenge, although in most cases a nicer problem than the alternative. For investors, the demographic cloud hanging over the silver economy really does have a silver lining.